Ryanair is threatening Minister for Transport Paschal Donohoe with legal action unless he withdraw a statutory direction to the State's aviation regulator that the airline claims will increase passenger charges at Dublin Airport.
Mr Donohoe this week directed the Commission for Aviation Regulation (CAR) to ensure the State-owned Dublin Airport Authority (DAA) has the cash to implement Government policy when the regulator sets the company's passenger charges for the 2014 to 2019 period at the end of the month.
Unlawful
Ryanair’s regulatory affairs chief,
Juliusz Komorek
, wrote to Mr Donohoe yesterday arguing that the direction was unlawful and warning that if he does not withdraw it by the close of business next Tuesday, the airline will go to court to have it judicially reviewed.
The Aviation Regulation Act allows the Minister to give general policy directions to the commission. However Mr Komorek claims that Mr Donohoe has gone beyond this by issuing specific instructions, something he says the legislation does not entitle him to do.
The CAR wants to veto €170 million of the DAA's spending plans to allow the cap on its passenger charges to be cut by 22 per cent from €10.68 to €8.35 between next year and 2019. Two of the airport's biggest customers, Ryanair and Aer Lingus, want even deeper reductions.
However, the DAA says that the cap should be set at €13.50, but has pledged that any further increases above its current average charge of €10.50 per passenger will only be in line with inflation.
Mr Komorek’s letter claims that the Minister’s direction will result in the regulator being obliged to sanction up to €425 million in extra capital spending at Dublin Airport, which will in turn lead to increased costs and charges.
Government policy
The Minister’s letter to acting commissioner
John Spicer
highlights a number of specific areas of Government policy. These include maintaining the airport’s status as an international gateway, ensuring that it has the runway and terminal facilities to develop routes with key markets and ensuring that Dublin can borrow money on commercial terms rather than relying on exchequer aid. Mr Donohoe wrote to the CAR on Tuesday. He reminded the agency that directions from previous ministers still stood.
